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ACC 564 ( Accounting Information Systems) Complete Class

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ACC 564 ( Accounting Information Systems) Complete Class

ACC 564 Week 2 Assignment 1 – Information Needs for the AIS

In 1967, Russell Ackoff presented a classical analysis of misinformation in management (Ackoff’s Management Misinformation Systems, Case 1-1, pg. 21 of the text). Now, you need to fast-forward to the present. After reading the case, craft your own version of misinformation in management by developing five (5) key incorrect assumptions that management makes about its accounting information systems.

For this assignment, research the Internet or Strayer databases for information related to improper assumptions concerning accounting information systems.

Write a five to seven (5-7) page paper in which you:

Based on your research, assess how corporate leaders may make improper assumptions related to accounting information systems and the related information. Indicate the most negative potential impacts on business operations related to these assumptions. Provide support for your rationale.

Suggest three to four (3-4) ways in which organizational performance may be improved when information is properly managed within a business system. Provide support for your rationale.

Evaluate the level of system security (i.e., high, medium, low) needed to ensure information integrity within automated business systems. Provide support for your evaluation.

Use at least three (3) quality resources in this assignment. Note: Wikipedia and similar Websites do not qualify as quality resources.

ACC 564 Week 3 Quiz 1

1) Which of the following statements below shows the contrast between data and information?

A) Data is the output of an AIS.

B) Information is the primary output of an AIS.

C) Data is more useful in decision-making than information.

D) Data and information are the same.

2) Information is

A) basically the same as data.

B) raw facts about transactions.

C) potentially useful facts when processed in a timely manner.

D) data that has been organized and processed so that it’s meaningful.

3) The value of information can best be defined as

A) how useful it is to decision makers.

B) the benefits produced by possessing and using the information minus the cost of producing it.

C) how relevant it is.

D) the extent to which it maximizes the value chain.

4) An accounting information system (AIS) processes ________ to provide users with ________.

A) data; information

B) data; transactions

C) information; data

D) data; benefits

5) Information that reduces uncertainty, improves decision makers’ ability to make predictions, or confirms or corrects their prior expectations, is said to be

A) complete.

B) relevant.

C) reliable.

D) timely.

6) Information that is free from error or bias and accurately represents the events or activities of the organization is

A) relevant.

B) reliable.

C) verifiable.

D) timely.

7) Information that does not omit important aspects of the underlying events or activities that it measures is

A) complete.

B) accessible.

C) relevant.

D) timely.

8) When two knowledgeable people acting independently each produce the same information, this information is said to be

A) complete.

B) relevant.

C) reliable.

D) verifiable.

9) Data must be converted into information to be considered useful and meaningful for decision-making. There are six characteristics that make information both useful and meaningful. If information is free from error or bias and accurately represents the events or activities of the organization, it is representative of the characteristic of

A) relevancy.

B) timeliness.

C) understandability.

D) reliability.

10) An accounting information system must be able to perform which of the following tasks?

A) collect transaction data

B) process transaction data

C) provide adequate controls

D) all of the above

11) Which of the following is not an example of a common activity in an AIS?

A) buy and pay for goods and services

B) sell goods and services and collect cash

C) summarize and report results to interested parties

D) recording of sales calls for marketing purposes

12) Which of the following is not one of the components of an AIS?

A) Internal controls and security measures

B) People

C) Procedures and instructions

D) Hardware

13) One group that relies on both the adequate collection and transformation of data for decision-making purposes for an organization is

A) management.

B) interested outsiders.

C) competitors.

D) the government.

14) The primary objective of accounting is to

A) implement strong internal controls.

B) provide useful information to decision makers.

C) prepare financial statements.

D) ensure the profitability of an organization.

A) the Certified Management Accountant.

B) the Certified Information Technology Professional.

C) the Certified Internal Auditor.

D) the Certified Data Processing Professional.

16) The AIS must include controls to ensure

A) safety and availability of data.

B) marketing initiatives match corporate goals.

C) information produced from data is accurate.

D) both A and C

17) A change in the AIS that makes information more easily accessible and widely available within an organization is most likely to first influence the

A) organizational culture.

B) customer base.

C) external financial statement users.

D) production activity.

18) The process of creating value for customers is the result of nine activities that form a

A) value chain.

B) profitable operation.

C) successful business.

D) support system.

19) The value chain concept is composed of two types of activities known as

A) primary and support.

B) primary and secondary.

C) support and value.

D) technology and support.

20) Which of the following is a primary activity in the value chain?

A) infrastructure

B) technology

C) purchasing

D) marketing and sales

More Questions are also Included

ACC 564 Week 10 Assignment 4 – Changing the Accounting Information System

Migrating to a new accounting information system is not an easy task. Many firms have struggled with this process, even though our textbook makes the process seem quite straightforward. Recently, IBM recapped some of the lessons learned in migrating to a new accounting information system within the federal government. These lessons can be applied to any accounting information system project. Others have developed their own recommendations for best practices and lessons learned involving implementing accounting information systems. However, in order to appreciate what IBM and others are proposing, we need to apply lessons learned to a real-life situation involving the failure to implement an accounting system properly.

For this assignment, research the Internet or Strayer databases for information related to a real-life accounting information system failure and best practices, as well as lessons learned from implementing the accounting system. In addition to information that you may find during your research, please use the following IBM article to complete the assignment: (http://www.businessofgovernment.org/article/what-we-know-now-lessons-learned-implementing-federal-financial-systems-projects).

Write a ten to twelve (10-12) page paper in which you:

Identify three to five (3-5) factors that contributed to the accounting information system failure within the business that you have identified. Indicate the impact to the business. Provide support for your rationale.

Assess senior management responsibility for the failure in question. Specify what the senior management could have done differently to avoid the failure. Provide support for your rationale.

Evaluate whether the most significant failure occurred within the system design, implementation, or operational phase of the process. Indicate what the company could have done to avoid the failed outcome. Provide support for your rationale.

Evaluate how implementing best practices would have reduced the chances for failure. Provide support for your rationale.

Based on your research, develop a list of between four (4) and six (6) best practices that organizations should use today to reduce the chances for failure. Provide support for your rationale.

Using the information provided by IBM and others, indicate which of the principles designed to provide insight into effective and efficient strategies on how to best deploy financial management systems, which were outlined within the related article, should serve as an example of what not to do when establishing the foundation for a firm to follow. Your proposed foundation should consist of at least two (2) principles, but no more than six (6). Provide support for your rationale.

Use at least three (3) quality resources in this assignment

ACC 564 Week 11 Final Exam Answers

1) Which of the following statements below shows the contrast between data and information? A) Data is the output of an AIS. B) Information is the primary output of an AIS. C) Data is more useful in decision-making than information. D) Data and information are the same.

2) Information is A) basically the same as data. B) raw facts about transactions. C) potentially useful facts when processed in a timely manner. D) data that has been organized and processed so that it’s meaningful.

3) The value of information can best be defined as A) how useful it is to decision makers. B) the benefits produced by possessing and using the information minus the cost of producing it. C) how relevant it is. D) the extent to which it maximizes the value chain.

4) An accounting information system (AIS) processes ________ to provide users with ________. A) data; information B) data; transactions C) information; data D) data; benefits

5) Information that reduces uncertainty, improves decision makers’ ability to make predictions, or confirms or corrects their prior expectations, is said to be A) complete. B) relevant. C) reliable. D) timely.

6) Information that is free from error or bias and accurately represents the events or activities of the organization is A) relevant. B) reliable. C) verifiable. D) timely.

7) Information that does not omit important aspects of the underlying events or activities that it measures is A) complete. B) accessible. C) relevant. D) timely.

8) When two knowledgeable people acting independently each produce the same information, this information is said to be A) complete. B) relevant. C) reliable. D) verifiable.

10) An accounting information system must be able to perform which of the following tasks? A) collect transaction data B) process transaction data C) provide adequate controls D) all of the above

11) Which of the following is not an example of a common activity in an AIS? A) buy and pay for goods and services B) sell goods and services and collect cash C) summarize and report results to interested parties D) recording of sales calls for marketing purposes

12) Which of the following is not one of the components of an AIS? A) Internal controls and security measures B) People C) Procedures and instructions D) Hardware

13) One group that relies on both the adequate collection and transformation of data for decision-making purposes for an organization is A) management. B) interested outsiders. C) competitors. D) the government.

14) The primary objective of accounting is to A) implement strong internal controls. B) provide useful information to decision makers. C) prepare financial statements. D) ensure the profitability of an organization.

15) The American Institute of Certified Public Accountants (AICPA) has recognized the importance of AIS and the major impact information technology has on the area of accounting. To recognize individual CPAs who have met educational and experiential requirements in this area, the group formally created the designation known as A) the Certified Management Accountant. B) the Certified Information Technology Professional. C) the Certified Internal Auditor. D) the Certified Data Processing Professional.

16) The AIS must include controls to ensure A) safety and availability of data. B) marketing initiatives match corporate goals. C) information produced from data is accurate. D) both A and C

17) A change in the AIS that makes information more easily accessible and widely available within an organization is most likely to first influence the A) organizational culture. B) customer base. C) external financial statement users. D) production activity.

18) The process of creating value for customers is the result of nine activities that form a A) value chain. B) profitable operation. C) successful business. D) support system.

19) The value chain concept is composed of two types of activities known as A) primary and support. B) primary and secondary. C) support and value. D) technology and support.

20) Which of the following is a primary activity in the value chain? A) infrastructure B) technology C) purchasing D) marketing and sales

21) In value chain analysis, what is the activity of arranging the delivery of products to customers called? A) outbound logistics B) inbound logistics C) shipping D) delivery

22) An AIS provides value by A) improving products or services through information that increases quality and reduces costs. B) providing timely and reliable information to decision makers. C) creating new products. D) both A and B

23) In Chapter 1, Figure 1-4 shows the factors that influence the design of AIS. The diagram shows a bi-directional arrow between the organizational culture and the AIS. The reason for this two-way interchange between organizational culture and AIS is A) that the AIS should not influence the values of the organizational culture. B) because the organization’s culture influences the AIS, and likewise the AIS influences the organization’s culture by controlling the flow of information within the organization. C) due to the transfer of managers between the two corporate elements. D) the AIS impacts the organization’s key strategies.

24) An example of inbound logistics would consist of A) the activities that transform inputs into final products or services. B) the activities that help customers to buy the organization’s products or services. C) the activities that provide post-sale support to customers. D) the activities that consist of receiving, storing, and distributing the materials used as inputs by the organization to create goods and/or services it sells.

25) A good example of how an AIS is used to share knowledge within an organization is A) the use of a corporate database to help staff identify the relevant experts who can help with a particular client. B) the use of laptop computers to access a network for messaging worldwide. C) the monitoring of production equipment to watch for defects. D) the use of point-of-sale data to determine hot-selling items.

#ACC 564 ( Accounting Information Systems) Complete Class

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ACC 562 Wk 7 Assignment 3 F&C International

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ACC 562 Wk 7 Assignment 3 F&C International

Write a five to six (5-6) page paper in which you:

Over time, there has been significant legislation passed, such as Sarbanes-Oxley, yet corporate fraud is still pervasive in today’s business environment. Suggest three (3) new ways that you believe will eradicate corporate fraud.

In the F&C case, inventory manipulation was used to enact the fraud. Discuss the proper internal controls needed over inventory and how these controls will act as a deterrent to fraudulent activities.

For a moment, step into the shoes of Catherine Sprauer at F&C International. Indicate what you would have done following each of the confrontations she had with the two employees who insisted that F&C executives were involved in a fraudulent scheme to misrepresent the company’s financial statements.

Discuss how accounting firms should modify their audit procedures to ensure the risk of financial fraud is minimized.

Discuss how the Securities and Exchange Commission (SEC) continues to fail to detect fraudulent activities in publically traded companies. Suggest a recommendation for improvement.

Evaluate whether legislation and regulatory agency oversight will increase or decrease corporate fraud. Explain your position.

Use at least three (3) quality resources in this assignment.

#ACC 562 Wk 7 Assignment 3 F&C International

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ACC 562 WK 4 Assignment 2 – North Face

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ACC 562 WK 4 Assignment 2 – North Face

Write a four to five (4-5) page paper in which you:

The SEC sanctioned Richard Fiedelman for failing to document the changes that his subordinates had made in 1997 North Face work papers and for failing to exercise due professional care. Explain the SEC’s rationale in making each of these allegations.

Take a position on the severity of the SEC’s punishment of Richard Fiedelman of a three-year suspension on being involved in the audits of SEC clients. Support your position.

Assume that you are an audit manager in a public accounting firm. The engagement partner asks you to modify client work papers after the financial statements and opinion has been issued. Determine what you would do in this situation. Provide your rationale.

Evaluate the practice of “materiality” used by public accounting firms and how accounting firms should address it with clients.

North Face’s management teams were criticized for strategic blunders that they made over the course of the company’s history. Discuss whether auditors have a responsibility to assess the quality of the key decisions made by client executives. Defend your answer.

Use at least three (3) quality resources in this assignment.

#ACC 562 WK 4 Assignment 2 – North Face

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ACC 562 WK 3 Assignment 1 – Nextcard, IncTo Download tutorial Copy and Paste below Link into your Browser

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ACC 562 WK 3 Assignment 1 – Nextcard, Inc

Write a four to five (4-5) page paper in which you:

Given PCAOB oversight of accounting firms and the AICPA Code of Conduct, discuss whether or not you believe that public accounting firms can successfully manipulate audit work papers and records of clients engaged in fraudulent activity.

Analyze the fraud risk factors presented during the 2000 Nextcard audit and how each should have impacted the audit procedures.

In the Nextcard case, discuss how Ernst & Young’s motivation to destroy the audit work papers reconciles with its obligation to provide assurances to financial investors.

Assume the role of Oliver Flanagan in the case. Identify the actions you would have taken when Robert Trauger asked you to help him alter the 2000 Nextcard audit work papers. In answering this question, discuss alternative courses of action available to you.

Search the Internet for a public accounting firm that recently destroyed audit evidence related to a client. Identify the public accounting firm and evaluate the punishment that the firm received for the Professional Code of Conduct violation. Evaluate the severity of the punishment to determine whether you agree or disagree with the severity.

Use at least three (3) quality resources in this assignment.

#ACC 562 WK 3 Assignment 1 – Nextcard Inc

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ACC 560 (Managerial Accounting) Complete Class

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ACC 560 (Managerial Accounting) Complete Class

ACC 560 Week 1 HW Ch01 – Exercises 5, 8, 12, and 16, Problems 1 and 4

ACC 560 Week 2 HW Ch02 – Exercises 4, 9, 11, and 12, Problems 1 and 5

ACC 560 Week 2 HW Ch03 – Exercises 2, 5, 6, and 13, Problems 1 and 6

ACC 560 Week 2 Quiz 1

ACC 560 Week 3 Assignment 1 – Activity-based Costing (ABC) in Service Industries

ACC 560 Week 3 HW Ch04 – Exercise 2, 3, 9, and 12, Problems 2 and 4

ACC 560 Week 3 Quiz 2

ACC 560 Week 3 Quiz 3

ACC 560 Week 4 HW Ch05 – Exercises 8, 13, 14, and 17, Problems 1 and 5

ACC 560 Week 4 HW Ch06 – Exercises 5, 10, 13, and 14, Problems 1 and 5

ACC 560 Week 4 Quiz 4

ACC 560 Week 5 HW Ch07 – Exercises 2, 5, 9, and 17, Problems 1 and 4

ACC 560 Week 5 HW Ch08 – Exercises 4, 5, 10, and 16, Problems 1 and 6

ACC 560 Week 5 Quiz 5

ACC 560 Week 5 Quiz 6

ACC 560 Week 6 HW Ch09 – Exercises 2, 6, 17, and 19, Problems 2 and 4

ACC 560 Week 6 HW Ch10 – Exercise 3, 7, 13, and 19, Problems 1 and 4

ACC 560 Week 6 Quiz 7

ACC 560 Week 6 Quiz 8

ACC 560 Week 7 HW Ch11 – Exercises 2, 4, 14, and 16, Problems 1 and 4

ACC 560 Week 7 Quiz 9

ACC 560 Week 7 Quiz 10

ACC 560 Week 8 HW Ch12 – Exercises 3, 6, 7, and 11, Problems 1 and 3

ACC 560 Week 8 Quiz 11

ACC 560 Week 9 Assignment 2 – Johnson Controls Capital Investments

ACC 560 Week 9 HW Ch13 – Exercise 1, 3, 5, and 8, Problems 2 and 5

ACC 560 Week 9 Quiz 12

ACC 560 Week 10 HW Ch14 – Exercises 1, 3, 9, and 13, Problems 1 and 6

ACC 560 Week 10 Quiz 13

ACC 560 Week 11 Quiz 14

#ACC 560 (Managerial Accounting) Complete Class

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ACC 557 Homework Week 2 – Chapter 19 Problem 1

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ACC 557 Homework Week 2 – Chapter 19 Problem 1

Problem 1:

California Surplus Inc. qualifies to use the installment-sales method for tax purposes and sold an investment on an installment basis. The total gain of $75000 was reported for financial reporting purposes in the period of sale. The installment period is 3 years; one-third of the sale price is collected in 2014 and the rest in 2015 and 2016. The tax rate was 35% in 2014, 30% in 2015, and 30% in 2016. The enacted tax rates of 2015 and 2016 are not known until 2015. The accounting and tax data are shown below.

Financial Accounting

Tax Return

2014 (35% tax rate)

Income before temporary difference

$ 175,000

Temporary difference

$ 75,000

$ 25,000

Income

$ 250,000

$ 200,000

2015 (30% tax rate)

Income before temporary difference

$ 200,000

Temporary difference

$ –

$ 25,000

Income

$ 200,000

$ 225,000

2016 (30% tax rate)

Income before temporary difference

$ 180,000

Temporary difference

$ –

$ 25,000

Income

$ 180,000

$ 205,000

Required:

Prepare the journal entries to record the income tax expense, deferred income taxes, and the income taxes payable for 2014, 2015, and 2016. No deferred income taxes existed at the beginning of 2012.

Explain how the deferred taxes will appear on the balance sheet at the end of each year. (Assume Installment Accounts Receivable is classified as a current asset.)

Show the income tax expense section of the income statement for each year, beginning with “Income before income taxes.”

Problem 2:

Trenton Co. incurred a net operating loss of $850,000 in 2014. Combined income of 2012 and 2013 was $650,000. The tax rate for all years is 30%. Trenton elects the carry back option.Required:

a. Prepare the journal entries to record the benefit of loss carry back and loss carry forward option.

b. Assuming that it is more likely than not that the entire net operating loss carry forward will not be realized in future years,prepare all the journal entries necessary at the end of 2014.

#ACC 557 Homework Week 2 – Chapter 19 Problem 1

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ACC 557 Homework 5 – Chapter 13To Download tutorial Copy and Paste below Link into your Browser

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ACC 557 Homework 5 – Chapter 13

Due Week 9 and worth 50 points

Directions: Answer the following questions on a separate Microsoft Word or Excel document. Explain how you reached the answer or show your work if a mathematical calculation is needed, or both. Submit your assignment using the assignment link in Blackboard.

Exercises

E13-3.Cushenberry Corporation had the following transactions.

Sold land (cost $12,000) for $15,000.

Issued common stock at par for $20,000.

Recorded depreciation on buildings for $17,000.

Paid salaries of $9,000.

Issued 1,000 shares of $1 par value common stock for equipment worth $8,000.

Sold equipment (cost $10,000, accumulated depreciation $7,000) for $1,200.

Instructions

For each transaction above, (a) prepare the journal entry, and (b) indicate how it would affect the statement of cash ﬂows using the indirect method.

E13-4.Gutierrez Company reported net income of $225,000 for 2015. Gutierrez also reported depreciation expense of $45,000 and a loss of $5,000 on the disposal of equipment. The comparative balance sheet shows a decrease in accounts receivable of $15,000 for the year, a $17,000 increase in accounts payable, and a $4,000 decrease in prepaid expenses.

Instructions

Prepare the operating activities section of the statement of cash ﬂows for 2015. Use the indirect method.

Problems

P13-3A.The income statement of Whitlock Company is presented here.

Additional information:

Accounts receivable increased $200,000 during the year, and inventory decreased $500,000.

Prepaid expenses increased $150,000 during the year.

Accounts payable to suppliers of merchandise decreased $340,000 during the year.

Accrued expenses payable decreased $100,000 during the year.

Operating expenses include depreciation expense of $70,000.

Instructions

Prepare the operating activities section of the statement of cash ﬂows for the year ended November 30, 2015, for Whitlock Company, using the indirect method.

P13-7A.Presented below are the ﬁnancial statements of Nosker Company.

Additional data:

Dividends declared and paid were $20,000.

During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had a book value of $8,500 at the time of sale.

All depreciation expense, $14,500, is in the operating expenses.

All sales and purchases are on account.

Instructions

Prepare a statement of cash ﬂows using the indirect method.

Compute free cash ﬂow.

#ACC 557 Homework 5 – Chapter 13

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ACC 557 Homework 2 Chapter , 4, 5 and 6

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ACC 557 Homework 2 Chapter , 4, 5 and 6

Due Week 4 and worth 105 points

Exercises

E4-7.Kay Magill Company had the following adjusted trial balance.

Instructions

Prepare closing entries at June 30, 2015.

Prepare a post-closing trial balance.

E4-13.Keenan Company has an inexperienced accountant. During the ﬁrst 2 weeks on the job, the accountant made the following errors in journalizing transactions. All entries were posted as made.

A payment on account of $840 to a creditor was debited to Accounts Payable $480 and credited to Cash $480.

The purchase of supplies on account for $560 was debited to Equipment $56 and credited to Accounts Payable $56.

A $500 cash dividend was debited to Salaries and Wages Expense $500 and credited to Cash $500.

Instructions

Prepare the correcting entries.

E5-4.On June 10, Tuzun Company purchased $8,000 of merchandise from Epps Company, FOB shipping point, terms 2/10, n/30. Tuzun pays the freight costs of $400 on June 11. Damaged goods totaling $300 are returned to Epps for credit on June 12. The fair value of these goods is $70. On June 19, Tuzun pays Epps Company in full, less the purchase discount. Both companies use a perpetual inventory system.

Instructions

Prepare separate entries for each transaction on the books of Tuzun Company.

Prepare separate entries for each transaction for Epps Company. The merchandise purchased by Tuzun on June 10 had cost Epps $4,800.

E5-7.Juan Morales Company had the following account balances at year-end: Cost of Goods Sold $60,000, Inventory $15,000, Operating Expenses $29,000, Sales Revenue $115,000, Sales Discounts $1,200, and Sales Returns and Allowances $1,700. A physical count of inventory determines that merchandise inventory on hand is $13,900.

Instructions

Prepare the adjusting entry necessary as a result of the physical count.

Prepare closing entries.

E6-1.Tri-State Bank and Trust is considering giving Josef Company a loan. Before doing so, management decides that further discussions with Josef’s accountant may be desirable. One area of particular concern is the inventory account, which has a year-end balance of $297,000. Discussions with the accountant reveal the following.

Josef sold goods costing $38,000 to Sorci Company, FOB shipping point, on December 28. The goods are not expected to arrive at Sorci until January 12. The goods were not included in the physical inventory because they were not in the warehouse.

The physical count of the inventory did not include goods costing $95,000 that were shipped to Josef FOB destination on December 27 and were still in transit at year-end.

Josef received goods costing $22,000 on January 2. The goods were shipped FOB shipping point on December 26 by Solita Co. The goods were not included in the physical count.

Josef sold goods costing $35,000 to Natali Co., FOB destination, on December 30. The goods were received at Natali on January 8. They were not included in Josef’s physical inventory.

Josef received goods costing $44,000 on January 2 that were shipped FOB destination on December 29. The shipment was a rush order that was supposed to arrive December 31. This purchase was included in the ending inventory of $297,000.

Instructions

Determine the correct inventory amount on December 31.

E6-6.Kaleta Company reports the following for the month of June.

Instructions

Compute the cost of the ending inventory and the cost of goods sold under (1) FIFO and (2) LIFO.

Which costing method gives the higher ending inventory? Why?

Which method results in the higher cost of goods sold? Why?

Problems

P4-3A.The completed ﬁnancial statement columns of the worksheet for Fleming Company are shown on below.

Instructions

Prepare an income statement, a retained earnings statement, and a classiﬁed balance sheet.

Prepare the closing entries.

Post the closing entries and underline and balance the accounts. (Use T-accounts.) Income Summary is account No. 350.

Prepare a post-closing trial balance.

P5-2A.Latona Hardware Store completed the following merchandising transactions in the month of May. At the beginning of May, the ledger of Latona showed Cash of $5,000 and Common Stock of $5,000.

May 1 Purchased merchandise on account from Gray’s Wholesale Supply $4,200, terms 2/10, n/30.

2 Sold merchandise on account $2,100, terms 1/10, n/30. The cost of the merchandise sold was $1,300.

5 Received credit from Gray’s Wholesale Supply for merchandise returned $300.

9 Received collections in full, less discounts, from customers billed on sales of$2,100 on May 2.

10 Paid Gray’s Wholesale Supply in full, less discount.

11 Purchased supplies for cash $400.

12 Purchased merchandise for cash $1,400.

15 Received refund for poor quality merchandise from supplier on cash purchase $150.

17 Purchased merchandise from Amland Distributors $1,300, FOB shipping point, terms 2/10, n/30.

19 Paid freight on May 17 purchase $130.

24 Sold merchandise for cash $3,200. The merchandise sold had a cost of $2,000.

25 Purchased merchandise from Horvath, Inc. $620, FOB destination, terms 2/10, n/30.

27 Paid Amland Distributors in full, less discount.

29 Made refunds to cash customers for defective merchandise $70. The returned merchandise had a fair value of $30.

31 Sold merchandise on account $1,000 terms n/30. The cost of the merchandise sold was $560.

Latona Hardware’s chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Inventory, No. 126 Supplies, No. 201 Accounts Payable, No. 311 Common Stock, No. 401 Sales Revenue, No. 412 Sales Returns and Allowances, No. 414 Sales Discounts, and No. 505 Cost of Goods Sold.

Instructions

Journalize the transactions using a perpetual inventory system.

Enter the beginning cash and common stock balances and post the transactions. (Use J1 for the journal reference.)

Prepare an income statement through gross proﬁt for the month of May 2015.

P6-3A.Ziad Company had a beginning inventory on January 1 of 150 units of Product 4-18-15 at a cost of $20 per unit. During the year, the following purchases were made.

Mar. 15 400 units at $23 Sept. 4 350 units at $26

July 20 250 units at $24 Dec. 2 100 units at $29

1,000 units were sold. Ziad Company uses a periodic inventory system.

Instructions

Determine the cost of goods available for sale.

Determine (1) the ending inventory, and (2) the cost of goods sold under each of the assumed cost ﬂow methods (FIFO, LIFO, and average-cost). Prove the accuracy of the cost of goods sold under the FIFO and LIFO methods.

Which cost ﬂow method results in (1) the highest inventory amount for the balance sheet, and (2) the highest cost of goods sold for the income statement?

#ACC 557 Homework 2 Chapter 4 5 and 6

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ACC 557 Homework 1: Chapters 1, 2, and 3

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ACC 557 Homework 1: Chapters 1, 2, and 3

Due Week 2 and worth 95 points

Directions: Answer the following questions in a separate Microsoft Word or Excel document. Explain how you reached the answer or show your work if a mathematical calculation is needed, or both. Submit your assignment using the assignment link in Blackboard.

Exercises

E1-11.Two items are omitted from each of the following summaries of balance sheet and income statement data for two corporations for the year 2015, Plunkett Co. and Herring Enterprises.

Instructions

Determine the missing amounts.

E2-9.Selected transactions from the journal of Kati Tillman, investment broker, are presented below.

Instructions

Post the transactions to T-accounts.

Prepare a trial balance at August 31, 2015.

E2-11.Presented below is the ledger for Higgs Co.

Instructions

Reproduce the journal entries for the transactions that occurred on October 1, 10, and 20, and provide explanations for each.

Determine the October 31 balance for each of the accounts above, and prepare a trial balance at October 31, 2015.

E3-7.The ledger of Perez Rental Agency on March 31 of the current year includes the selected accounts, shown below, before quarterly adjusting entries have been prepared.

An analysis of the accounts shows the following.

The equipment depreciates $400 per month.

One-third of the unearned rent revenue was earned during the quarter.

Interest totaling $500 is accrued on the notes payable for the quarter.

Supplies on hand total $900.

Insurance expires at the rate of $200 per month.

Instructions

Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Additional accounts are Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expense.

E3-11.A partial adjusted trial balance of Gehring Company at January 31, 2015, shows the following.

Instructions

Answer the following questions, assuming the year begins January 1.

If the amount in Supplies Expense is the January 31 adjusting entry, and $1,000 of supplies was purchased in January, what was the balance in Supplies on January 1?

If the amount in Insurance Expense is the January 31 adjusting entry, and the original insurance premium was for one year, what was the total premium and when was the policy purchased?

If $3,500 of salaries was paid in January, what was the balance in Salaries and Wages Payable at December 31, 2014?

Problems

P1-2A.On August 31, the balance sheet of La Brava Veterinary Clinic showed Cash $9,000, Accounts Receivable $1,700, Supplies $600, Equipment $6,000, Accounts Payable $3,600, Common Stock $13,000, and Retained Earnings $700. During September, the following transactions occurred.

Paid $2,900 cash for accounts payable due.

Collected $1,300 of accounts receivable.

Purchased additional equipment for $2,100, paying $800 in cash and the balance on account.

Recognized revenue of $7,300, of which $2,500 is collected in cash and the balance is due in October.

Declared and paid a $400 cash dividend.

Paid salaries $1,700, rent for September $900, and advertising expense $200.

Incurred utilities expense for month on account $170.

Received $10,000 from Capital Bank on a 6-month note payable.

Instructions

Prepare a tabular analysis of the September transactions beginning with August 31 balances. The column headings should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes Payable + Accounts Payable + Common Stock + Retained Earnings + Revenues – Expenses – Dividends.

Prepare an income statement for September, a retained earnings statement for September, and a balance sheet at September 30.

P2-2A.Julia Dumars is a licensed CPA. During the ﬁrst month of operations of her business, Julia Dumars, Inc., the following events and transactions occurred.

May 1 Stockholders invested $20,000 cash in exchange for common stock.

2 Hired a secretary-receptionist at a salary of $2,000 per month.

3 Purchased $1,500 of supplies on account from Vincent Supply Company.

7 Paid ofﬁce rent of $900 cash for the month.

11 Completed a tax assignment and billed client $2,800 for services performed.

12 Received $3,500 advance on a management consulting engagement.

17 Received cash of $1,200 for services performed for Orville Co.

31 Paid secretary-receptionist $2,000 salary for the month.

31 Paid 40% of balance due Vincent Supply Company.

Julia uses the following chart of accounts: No. 101 Cash, No. 112 Accounts Receivable, No. 126 Supplies, No. 201 Accounts Payable, No. 209 Unearned Service Revenue, No. 311Common Stock, No. 400 Service Revenue, No. 726 Salaries and Wages Expense, and No. 729 Rent Expense.

Instructions

Journalize the transactions.

Post to the ledger accounts.

Prepare a trial balance on May 31, 2015.

P3-1A.Deanna Nardelli started her own consulting ﬁrm, Nardelli Consulting, on May 1, 2015. The trial balance at May 31 is as follows.

In addition to those accounts listed on the trial balance, the chart of accounts for Nardelli Consulting also contains the following accounts and account numbers: No. 150 Accumulated Depreciation—Equipment, No. 212 Salaries and Wages Payable, No. 631 Supplies Expense, No. 717 Depreciation Expense, No. 722 Insurance Expense, and No. 732 Utilities Expense.

Other data:

$900 of supplies have been used during the month.

Utilities expense incurred but not paid on May 31, 2015, $250.

The insurance policy is for 2 years.

$400 of the balance in the unearned service revenue account remains unearned at the end of the month.

May 31 is a Wednesday, and employees are paid on Fridays. Nardelli Consulting has two employees, who are paid $900 each for a 5-day work week.

The equipment has a 5-year life with no salvage value. It is being depreciated at $190 per month for 60 months.

Invoices representing $1,700 of services performed during the month have not been recorded as of May 31.

Instructions

Prepare the adjusting entries for the month of May. Use J4 as the page number for your journal.

Enter the totals from the trial balance as beginning account balances and place a check mark in the posting reference column. Post the adjusting entries to the ledger accounts.

Prepare an adjusted trial balance at May 31, 2015.

#ACC 557 Homework 1: Chapters 1 2 and 3

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ACC 555 WK 10 Assignment 3 – Tax Periods and Method

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ACC 555 WK 10 Assignment 3 – Tax Periods and Method

Imagine that you have always wanted to own a business and have now created a new start-up company. Write an eight to ten (8-10) page paper in which you: 1. Analyze the start-up company you created. Include in your analysis the type of company you have created, its business objectives, and other factors that you believe are important to the success of the business. 2. Determine the types of accounting periods that you could choose from for the company. Choose the type of accounting period that would provide the greatest tax benefit. Provide example(s) to support your proposal. 3. Evaluate the appropriateness of the types of accounting methods that would be available for your business. Recommend the method that would minimize the tax liabilities for the company. Provide support for your rationale. 4. Choose at least two (2) specific transactions, and then propose one (1) special accounting method which your company would use to account for these transactions. Indicate any significant tax consequences that may result from the method you proposed.

#ACC 555 WK 10 Assignment 3 – Tax Periods and Method

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ACC 555 WK 7 Assignment 2 – Tax-Deductible Losses

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ACC 555 WK 7 Assignment 2 – Tax-Deductible Losses

Write a six to eight (6-8) page paper in which you: 1. Research the manner in which tax-deductible losses originally became part of the U.S. Tax Code. Conclude whether or not tax-deductible losses overall are reasonable. Provide support for your conclusions. 2. Suggest what you believe to be a significant tax-deductible loss. Discuss whether or not the deductibility of this loss harms other taxpayers in general. Recommend changes to this tax-deductible loss you would make that would be fairer to all taxpayers. 3. Choose a type of loss that is not deductible, and argue whether these losses should continue to be disallowed, or why they should be allowed. Provide support for the rationale

#ACC 555 WK 7 Assignment 2 – Tax-Deductible Losses

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ACC 555 Individual Tax Research and Planning – Full Class

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ACC 555 Individual Tax Research and Planning – Full Class

ACC 555 Assignment 1 – Tax Research

Imagine that the Internal Revenue Service (IRS) has selected your client for an audit. Your client and the IRS disagree about the amount of tax revenue owed. You agree with your client’s position. You must provide a defense for the client that requires you to research the issues in order to render an educated opinion on a course of action for your client. Note: You may create and/or make all necessary assumptions needed for the completion of this assignment. Write a three to four (3-4) page paper in which you: 1. Prepare a defensible strategy for the client by using the six (6) steps in the tax research process. Propose how each of the steps provides support for the client’s position. 2. Create a fact-based argument that you plan to propose to the client as a defense of his / her position with the IRS.

ACC 555 Assignment 2 – Tax-Deductible Losses

ACC 555 Assignment 3 – Tax Periods and Method

ACC 555 Week 5 Midterm Exam Answers

1) The federal income tax is the dominant form of taxation by the federal government.

2) The Sixteenth Amendment permits the passage of a federal income tax.

3) When a change in the tax law is deemed necessary by Congress, the entire Internal Revenue Code must be revised.

4) A progressive tax rate structure is one where the rate of tax increases as the tax base increases.

5) The terms “progressive tax” and “flat tax” are synonymous.

6) A proportional tax rate is one where the rate of the tax is the same for all taxpayers, regardless of income levels.

7) Regressive tax rates decrease as the tax base increases.

8) The marginal tax rate is useful in tax planning because it measures the tax effect of a proposed transaction.

9) A taxpayer’s average tax rate is the tax rate applied to an incremental amount of taxable income that is added to the tax base.

10) If a taxpayer’s total tax liability is $30,000, taxable income is $100,000, and economic income is $120,000, the average tax rate is 30 percent.

11) If a taxpayer’s total tax liability is $4,000, taxable income is $20,000, and total economic income is $40,000, then the effective tax rate is 20 percent.

12) All states impose a state income tax which is generally based on an individual’s federal adjusted gross income (AGI) with minor adjustments.

13) The unified transfer tax system, comprised of the gift and estate taxes, is based upon the total property transfers an individual makes during lifetime and at death.

14) Gifts between spouses are generally exempt from transfer taxes.

15) The primary liability for payment of the gift tax is imposed upon the donee.

16) For gift tax purposes, a $14,000 annual exclusion per donee is permitted.

17) Property is generally included on an estate tax return at its historical cost basis.

18) Property transferred to the decedent’s spouse is exempt from the estate tax because of the estate tax marital deduction provision.

19) Gifts made during a taxpayer’s lifetime may affect the amount of estate tax paid by the taxpayer’s estate.

20) While federal and state income taxes as well as the federal gift and estate taxes are generally progressive in nature, property taxes are proportional.

21) Adam Smith’s canons of taxation are equity, certainty, convenience and economy.

22) The primary objective of the federal income tax law is to achieve various economic and social policy objectives.

23) Individuals are the principal taxpaying entities in the federal income tax system.

24) The various entities in the federal income tax system may be classified into two general categories, taxpaying entities (such as individuals and C [regular] corporations) and flow-through entities such as sole proprietorships, partnerships, S corporations, and limited liability companies.

25) In 2013, dividends paid from most U.S. corporations are taxed at the same rate as the recipients’ salaries and wages.

26) Flow-through entities do not have to file tax returns since they are not taxable entities.

27) S Corporations result in a single level of taxation.

28) In a limited liability partnership, a partner is not liable for his partner’s acts of negligence or misconduct.

29) Limited liability companies may elect to be taxed as corporations.

30) Limited liability company members (owners) are responsible for the liabilities of their limited liability company.

31) The tax law encompasses administrative and judicial interpretations, such as Treasury regulations, revenue rulings, revenue procedures, and court decisions, as well as statutes.

32) Generally, tax legislation is introduced first in the Senate and referred to the Senate Finance Committee.

33) The Internal Revenue Service is the branch of the Treasury Department responsible for administering the federal tax law.

34) Generally, the statute of limitations is three years from the later of the date the tax return is filed or the due date.

35) Arthur pays tax of $5,000 on taxable income of $50,000 while taxpayer Barbara pays tax of $12,000 on $120,000. The tax is a

A) progressive tax.

B) proportional tax.

C) regressive tax.

D) None of the above.

36) Which of the following taxes is progressive?

A) sales tax

B) excise tax

C) property tax

D) income tax

37) Which of the following taxes is proportional?

A) gift tax

B) income tax

C) sales tax

D) Federal Insurance Contributions Act (FICA)

38) Which of the following taxes is regressive?

A) Federal Insurance Contributions Act (FICA)

B) excise tax

C) property tax

D) gift tax

39) Sarah contributes $25,000 to a church. Sarah’s marginal tax rate is 35% while her average tax rate is 25%. After considering her tax savings, Sarah’s contribution costs

A) $6,250.

B) $8,750.

C) $16,250.

D) $18,750.

40) Helen, who is single, is considering purchasing a residence that will provide a $28,000 tax deduction for property taxes and mortgage interest. If her marginal tax rate is 25% and her effective tax rate is 20%, what is the amount of Helen’s tax savings from purchasing the residence?

A) $5,600

B) $7,000

C) $21,000

D) $22,400

ACC 555 Week 11 Final Exam Answers

1) For individuals, all deductible expenses must be classified as deductions for AGI or deductions from AGI.

2) In 2013, medical expenses are deductible as a from AGI deduction to the extent that they exceed 7.5 percent of the taxpayer’s AGI.

3) Medical expenses paid on behalf of an individual who could be the taxpayer’s dependent except for the gross income or joint return tests are deductible as itemized deductions.

4) Medical expenses incurred on behalf of children of divorced parents are deductible by the parent who pays the expenses but only if that parent also is entitled to the dependency exemption.

5) The definition of medical care includes preventative measures such as routine physical examinations.

6) Due to stress on the job, taxpayer Charlie began to experience chest pains. In order to relax and relieve the pains, he and his spouse went on an ocean cruise. The cost of the cruise to alleviate this medical condition is tax deductible.

7) Expenditures for a weight reduction program are deductible if recommended by a physician to treat a specific medical condition such as hypertension caused by excess weight.

8) In order for a taxpayer to deduct a medical expense, the amount must be paid to a certified medical doctor (M.D.).

9) Jeffrey, a T.V. news anchor, is concerned about the wrinkles around his eyes. Because it is job-related, the cost of a face lift to eliminate these wrinkles is a deductible medical expense.

10) Expenditures for long-term care insurance premiums qualify as a medical expense deduction subject to an annual limit based upon the age of an individual.

11) Capital expenditures for medical care which permanently improve or better the taxpayer’s property are deductible to the extent the cost exceeds the increase in fair market value to the property attributable to the capital expenditure.

12) Expenditures incurred in removing structural barriers in the home of a physically handicapped individual are deductible only to the extent the cost exceeds the increase in fair market value to the property attributable to the capital expenditure.

13) If the principal reason for a taxpayer’s presence in an institution is the need and availability of medical care, the entire cost of lodging and meals is considered qualified medical expenditures.

14) A medical expense is generally deductible only in the year in which the expense is actually paid.

15) If a prepayment is a requirement for the receipt of the medical care, the payment is deductible in the year paid rather than the year in which the care is rendered.

16) If a medical expense reimbursement is received in a year after a deduction has been taken on a previous year’s return, the previous year’s return must be amended to eliminate the reimbursed expense.

17) Assessments or fees imposed for specific privileges or services are not deductible as taxes.

18) Foreign real property taxes and foreign income taxes are not deductible as itemized deductions.

19) A personal property tax based on the weight of the property is deductible.

20) Assessments made against real estate for the purpose of funding local improvements are not deductible in the year paid but rather should be added to the cost basis of the property.

21) Self-employed individuals may deduct the full self-employment taxes paid as a for AGI deduction.

22) Finance charges on personal credit cards are considered interest and are, therefore, deductible.

23) In general, the deductibility of interest depends on the purpose for which the indebtedness is incurred.

24) Interest expense incurred in the taxpayer’s trade or business is deductible as a for AGI deduction without limitation if the taxpayer materially participates in the business.

25) Investment interest expense which is disallowed because it exceeds the taxpayer’s net investment income may be carried over and treated as incurred in subsequent years.

26) Investment interest includes interest expense incurred to purchase tax-exempt securities.

27) Taxpayers may elect to include net capital gain as part of investment income.

28) Taxpayers may not deduct interest expense on personal debt including credit card debt, car loans, and other consumer debt.

29) Qualified residence interest consists of both acquisition indebtedness and home equity interest.

30) Acquisition indebtedness for a personal residence includes debt incurred to substantially improve the residence.

31) A taxpayer is allowed to deduct interest expense incurred on home equity indebtedness limited to the lesser of $100,000 or the home equity (FMV of the residence less the acquisition indebtedness).

32) While points paid to purchase a residence are deductible as interest in the period paid, points associated with the refinancing of a residence must be amortized and deducted over the life of the loan.

33) Christopher, a cash basis taxpayer, borrows $1,000 from ABC Bank by issuing a 3-month note on December 1, 2013. Christopher receives $940 but must repay $1,000 on the due date. The amount of interest expense deductible in 2013 is $20.

34) Charitable contributions made to individuals are deductible if the individuals can show extreme financial need.

35) For charitable contribution purposes, capital gain property includes property which, if sold, would produce a long-term capital gain.

36) A charitable contribution deduction is allowed for the FMV of services rendered to a qualified charitable organization.

37) A charitable contribution in excess of the deduction limit for one taxable year can be carried forward five years.

38) If a taxpayer makes a charitable contribution to a university and in return receives the right to purchase tickets to athletic events, the taxpayer may deduct only 80% of the payment.

39) Corporate charitable deductions are limited to 10% of the corporation’s taxable income for the year.

40) Legal fees for drafting a will are generally deductible.

#ACC 555 Individual Tax Research and Planning – Full Class

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Acc 492 Week 3 textbook assignment

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Acc 492 Week 3 textbook assignment

20-20 (Objectives 20-2, 20-3) Following are some of the tests of controls and substantive tests of transactions procedures often performed in the payroll and personnel cycle. (Each procedure is to be done on a sample basis or using audit software.)

1. Reconcile the monthly payroll total for direct manufacturing labor with the labor cost distribution.

2. Examine the time card for the approval of a foreman.

3. Recompute hours on the time card and compare the total with the total hours for which the employee has been paid.

4. Perform a surprise payroll payoff and observe employees picking up and signing for their checks.

5. Compare the employee name, date, check number, and amounts on cancelled checks with the payroll journal.

6. Trace the hours from the employee time cards to job tickets to make sure that the total reconciles, and trace each job ticket to the job-cost record.

7. Use audit software to account for the sequence of payroll checks in the payroll journal.

Required

a. Identify whether each of the procedures is primarily a test of control or a substantive test of transactions.

b. Identify the transaction-related audit objective(s) of each of the procedures.

21-21 (Objectives 21-1, 21-3, 21-5, 21-6, 21-7) The Frist Corporation has the following internal controls related to inventory:

1. Only authorized inventory warehousing personnel are allowed in inventory storage areas.

2. All inventory products are stored in warehousing areas that are segregated from other storage areas used to house equipment and supplies.

3. All inventory held on consignment at Frist Corporation is stored in a separate area of the warehouse.

4. The inventory purchasing system only allows purchases from pre-approved vendors.

5. The perpetual inventory system tracks the average number of days each inventory product number has been in the warehouse.

6. Microchips are embedded in each product and when inventory items are removed from the warehouse to shipping, radio-frequencies signal a deduction of inventory to the perpetual inventory system.

7. On a weekly basis, inventory accounting personnel take samples of inventory products selected from the perpetual inventory system and verify that the inventory is on-hand in the warehouse and that the quantities in the listing are correct.

8. On a weekly basis, inventory accounting personnel select inventory items on hand in the warehouse and verify that the item is included in the perpetual inventory listing at the correct amount.

9. The perpetual inventory system subtotals the quantity of inventory in the system and interfaces with the general ledger system on a daily basis to ensure quantities agree.

10. The perpetual inventory system will not accept inventory additions without the recording on a valid receiving report.

For each of the internal controls:

Required

a. Identify the related transaction-related audit objective(s) affected by the control.

b. Describe risks the control is designed to mitigate.

c. Design a test of control to determine if the control is operating effectively.

#Acc 492 Week 3 textbook assignment

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ACC 492 Final Exam Solution

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ACC 492 Final Exam Solution

) The bonding of employees will normally be expected to:

A. “weed out” dishonest employees already hired.

B. serve as a deterrent to dishonesty.

C. guarantee that all employee fraud will be prevented.

D. eliminate the need for separation of duties in the cash receipts area.

2) All sales, cash receipts, and sales adjustments are accurately valued using GAPP and correctly journalized, summarized, and posted. These actions are transaction objectives for:

A. occurance

B. cutoff

C. accurancy

D. completeness

3) Disclosure objectives include all of the following EXCEPT:

A. occurrence and rights and obligations

B. classification and understandability

C. completeness

D. cutoff

4) The extent of the auditor’s inventory test count would LEAST depend on which of the following?

A. The nature and composition of the inventory.

B. The existence of inventory at multiple locations.

C. The effectiveness of controls pertaining to maintenance of perpetual records.

D. The care exercised by client employees in taking the inventory.

5) When statistical sampling methods are used by the client in determining inventories, professional standards require that the auditor ascertain the following EXCEPT that the:

A. sampling plan has statistical validity.

B. appropriate tests of transactions have been applied.

C. results in terms of reliability are reasonable.

D. sampling plan has been properly applied.

6) The auditor’s strategy in performing test counts during the inventory observation is to:

A. concentrate tests on high dollar items and take a representative sample of other items.

B. concentrate tests in areas where employees seem to be disregarding the inventory instructions.

C. randomly select all test items.

D. test all high dollar items.

7) Observation of inventories is a required audit procedure whenever:

A. inventories are material.

B. the auditor considers it to be necessary.

C. it is practicable and reasonable.

D. inventories are material and it is practicable and reasonable.

8) With a manufacturer, wholesaler, or retailer, however, inherent risk for inventory may be assessed at or near the maximum level for all of the following reasons EXCEPT:

A. inventories are often stored at multiple sites, adding to the difficulties associated with maintaining physical controls over theft and damages, and properly accounting for goods in transit between sites.

B. the volume of purchases, manufacturing, and sales transactions that affects these accounts is generally high, decreasing the opportunities for misstatements to occur.

C. inventories are vulnerable to spoilage, obsolescence, and other factors such as general economic conditions that may affect demand and salability, and thus the proper valuation of the inventories.

D. the wide diversity of inventory items may present special problems in determining their quality and market value.

9) During the observation of the inventory, the auditor has NO responsibility to:

A. observe the taking of the inventory by client personnel.

B. make inquiries of the client concerning the inventories.

C. supervise the taking of the inventory.

D. make some test counts of inventory quantities.

10) The specific audit objective that all purchase transactions and cash disbursements are valued using GAAP and correctly journalized, summarized, and posted relates to:

A. rights and obligations.

B. completeness.

C. valuation or allocation.

D. existence or occurrence.

11) The specific audit objective that recorded purchases represent goods, services, and productive assets received during the period relates to:

A. rights and obligations.

B. completeness.

C. presentation and disclosure.

D. existence or occurrence.

12) The specific audit objective that all purchases and cash disbursements made during the period were recorded relates to:

A. rights and obligations.

B. completeness.

C. presentation and disclosure.

D. existence or occurrence.

13) The specific audit objective for the audit of investments, investment balances are properly identified and classified in the financial statements, relates to the:

A. existence or occurrence assertion.

B. completeness assertion.

C. presentation or disclosure assertion.

D. rights and obligations assertion.

14) The specific audit objective for the audit of investments, all recorded investments are owned by the reporting entity, relates to the:

A. existence or occurrence assertion.

B. completeness assertion.

C. valuation or allocation assertion.

D. rights and obligations assertion.

15) The specific audit objective for the audit of investments, all investments are included in the balance sheet investment accounts, relates to the:

A. existence or occurrence assertion.

B. completeness assertion.

C. valuation or allocation assertion.

D. rights and obligations assertion.

16) The specific account balance audit objective, plant assets and related expenses are properly identified and classified in the financial statements, relates to the:

A. rights and obligations assertion.

B. completeness assertion.

C. presentation or disclosure assertion.

D. existence or occurrence assertion.

17) The audit significance of the financial ratio, fixed asset turnover, is:

A. this financial ratio provides a reasonableness test of the entity’s proportion of equity that may be compared with prior years’ experience or industry data.

B. an unexpected increase or decrease in the depreciation expense as a percent of depreciable assets may indicate an error in calculating depreciation.

C. this financial ratio provides a test of the entity’s ability to generate earnings to cover the cost of service debt.

D. an unexpected increase in this financial ratio may indicate the failure to record or capitalize depreciable assets.

18) The substantive test of calculating fixed asset turnover is categorized under:

A. initial procedures.

B. analytical procedures.

C. tests of details of balances.

D. tests of details of transactions.

19) In confirming bank deposits, the auditor need NOT:

A. send two copies of the standard confirmation to the bank.

B. send requests for accounts with zero balances at the end of the year.

C. personally mail the requests.

D. have the bank return the original to the client.

20) The standard bank confirmation, developed jointly by the AICPA, the American Bankers Association, and the Bank Administration Institute, requests information about all of the following EXCEPT:

A. loan interest rates.

B. loan balances.

C. deposit balances.

D. secondary endorsements.

21) The control of all funds during the count of cash on hand is meant primarily to prevent:

A. any chance of double counting.

B. unauthorized disbursements.

C. transfers by the client.

D. client personnel from viewing the count procedure.

22) Whether the entity maintains effective controls to provide reasonable assurance that private customer information obtained as a result of e-commerce is protected from uses not related to the entity’s business defines:

A. information protection.

B. risk assessment.

C. transaction integrity.

D. performance measurement.

23) Best practices in approaching risk management include the following steps EXCEPT:

A. calculate revenue losses from risks.

B. analyze and assess risks.

C. identify risks.

D. design strategies for managing risk.

24) In performing an attest engagement, a CPA performs all of the following EXCEPT:

A. gathers evidence to support the assertions.

B. objectively assesses the measurements of assertions.

C. relies on management statements.

D. objectively assesses the communications of the individual making the assertions.

25) Which of the following is NOT among the characteristics of the procedures performed in completing the audit?

A. They involve many subjective judgments by the auditor.

B. They are performed after the balance sheet date.

C. They are optional since they have only an indirect impact on the opinion to be expressed.

D. They are usually performed by audit managers or other senior members of the audit team who have extensive audit experience with the client.

26) The auditor relies on the client representation letter to:

A. document the continuing materiality of client representations.

B. guarantee the absence of management fraud.

C. confirm written representations given to the auditor.

D. reduce the possibility of misunderstanding concerning management’s representations.

27) In performing an attest engagement, a CPA performs all of the following EXCEPT:

A. gathers evidence to support the assertions.

B. objectively assesses the measurements of assertions.

C. relies on management statements.

D. objectively assesses the communications of the individual making the assertions.

28) Which of the following is NOT among the specific auditing procedures the auditor performs to obtain additional audit evidence?

A. reading minutes of meetings

B. reviewing evidence concerning litigation, claims, and assessments

C. making subsequent events review

D. obtaining client representation letter

29) In regard to identifying and evaluating subsequent events, AU 560.12 specifies that the auditor inquires of management having responsibility for financial and accounting matters as to all of the following EXCEPT:

A. any significant changes in capital stock, long-term debt, or working capital to the date of inquiry.

B. the minutes of meetings of directors, stockholders, and other appropriate committees.

C. any substantial contingent liabilities or commitments existing at the balance sheet date or date of inquiry.

D. the current status of items previously accounted for on the basis of tentative, preliminary, or inconclusive data.

30) When an investigation of the discovery of facts existing at the report date confirms the existence of the fact and the auditor believes the information is important to those relying or likely to rely on the financial statements, the auditor should immediately:

A. notify the SEC or other regulatory agency.

B. notify the audit committee.

C. take steps to prevent future reliance on the audit report.

D. resign from the engagement.

31) The two main sections of the AICPA’s Code of Professional Conduct are:

A. Rules of Conduct and Interpretations of the Rules of Conduct.

B. Principles and Ethics Rulings.

C. Principles and Rules of Conduct.

D. Interpretations of the Rules of Conduct and Ethics Rulings.

32) In general, except when explicitly stated otherwise, the Rules of Conduct in the AICPA’s Code of Professional Conduct are applicable to:

A. all professional services.

B. all members and all professional services.

C. all members.

D. all members in public practice.

33) Which one of the following is NOT true of the Principles in the AICPA’s Code of Professional Conduct?

A. They are set forth as enforceable standards.

B. They are expressions of ideals of professional conduct.

C. They provide a framework for the Rules.

D. They express the basic tenets of ethical conduct.

34) Gross negligence can best be defined as:

A. misrepresentation.

B. criminal fraud.

C. failure to exercise due care.

D. failure to exercise even slight care.

35) Anyone identified to the auditor by name prior to the audit who is to be the principal recipient of the auditor’s report is a

A. foreseen beneficiary.

B. foreseeable party.

C. third party.

D. primary beneficiary.

36) The Fund of Funds case illustrated that auditors could be found liable for failure to report wrong-doings discovered:

A. on any type of engagement for a particular client.

B. even on engagements for other clients.

C. only on audit engagements for a particular client.

D. only on special fraud audits conducted under separate contract.

#ACC 492 Final Exam Solution

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